Author
Topic: “I’m going to work until I die” (Read 7914 times)

People are living longer, more expensive lives, often without much of a safety net. As a result, record numbers of Americans older than 65 are working — now nearly 1 in 5. That proportion has risen steadily over the past decade, and at a far faster rate than any other age group. Today, 9 million senior citizens work, compared with 4 million in 2000.

I will technically retire in about 15 years, but I'm working on setting a side business or businesses that will allow me some additional cash flow when I do. If I get them set up and they pay more than I'm making at my job, then I'm fine with that too, but for now, I'm looking at them for supplemental income now and when I retire.

I plan to work until I die. My wife plans to work until I hit my number at which point she will read books and do family things. But we have a plan. Do these retirees even consult an advisor?

About a decade ago we paid an attorney for some estate planning and he commented I was under insured. I've got overlapping term life insurance policies and a token amount for free from my employer. Between then it pays a bit more than 10 years gross income. I don't need my family to live like royalty, but they can pay off the mortgage, car and college tuition and coast for a few years easily. After that they can get their own jobs if they need more

About a decade ago we paid an attorney for some estate planning and he commented I was under insured. I've got overlapping term life insurance policies and a token amount for free from my employer. Between then it pays a bit more than 10 years gross income. I don't need my family to live like royalty, but they can pay off the mortgage, car and college tuition and coast for a few years easily. After that they can get their own jobs if they need more

My planner told us we were both over-insured. Um, no. My wife has a stable engineering job that basically pays the bills and more importantly gets us insurance. I am an independent investor with a couple side hustles. In short, neither of us are replaceable. I'm more replaceable because my wife could turn it over to the advisor but she loses the stay at home parent. But I've squandered going back to my engineering degree.

She's a breadwinner and I'm a 1950s housewife who yields high return and does the home repair and runs a couple businesses. They are both hard roles to replace.

The worst thing is being forced into doing something you don't want to do, just to survive. So it is good to have Plan A and Plan B for not having to work and be able to fully retire.

HOWEVER! A couple of other things to consider:

1) Plan to stay ACTIVE until you die. That may mean continue working full or part time in a physically active job, and/or regular disciplined exercise, and/or frequent recreational activities. Being at 63 my conclusion from the downward slope is: when you stop moving you start dying, so KEEP MOVING, friend!

2) Obscene medical and long-term care costs can drain the largest retirement fund. Keep insured but rules can change, insurance companies can go belly up, and you can't predict what your last years will be like. So have a plan for how you will handle medical costs in your later years. What you decide at 60 may be entirely different at 75, 85, 95. For instance, my Dad had a heart valve replace when he was late 70s. Kind of borderline whether that made sense but he was always in great physical shape so he went for it. He never fully recovered. Turns out he was already suffering early Parkinson's (undiagnosed) and the heart trouble accelerated it and 6 months after the heart valve operation he was having difficulty walking (stiff legs, balance). He slowly decline to wheelchair and then bed bound and after several years of exhausting minute-to-minute care from my mom he passed away. At the end pretty much everything had shut down--except his heart was beating strong! Not a pretty scenario the last couple of weeks and that strong heart just kept him conscious through it all. Even with great insurance it drained a lot of their savings.

3) Early dementia can also lead to devastating financial decision errors that wipe out savings. Have a plan for giving up control and who will take over and by what means. Having trusted offspring helps a bunch in this regard. Even in a great family it is shocking to see vultures start to circle the savings/inheritance long before the last breath is out. A family trust might be one option. Or financial accounts with one or two offspring as co-owners.

4) No external entity is 100% safe for holding your retirement funds. I have seen relatives wiped out because their company retirement fund went bankrupt the year before they were going to retire. I consulted at a utility owned by Enron just at the time they went belly up. A lot of friends had their entire retirement fund wiped out (it was all forced invested into Enron stock!). In 2008 we saw brokerage firm using customer funds to cover internal "investments" in high risk trades (highly illegal but it happened anyway). Have a retirement plan that does not depend on one source of holdings.

Considering all of these risk factors I think it is wise to plan to keep working beyond normal retirement age. You might start withdrawing retire funds at some point, but consider staying in the work force in some manner. If you are in your 60s and bail out of the work force for a couple of years, good luck with getting right back into it unless you have a very special skill not dependent on age, or you can restart a small business, etc. You might want to use this as an opportunity to get into a line of work you never would have as a career but would be fun to do with less overhead costs.

Part of retirement planning should be to be totally out of debt before you retire if not already. Make sure that house is paid off, you have good, reliable vehicle(s) that will last many years, no credit cards outstanding, etc. We saw several acquaintances that retired with a heavily mortgaged house and either having to sell and move into very small apartment or go back to career work.

Often a well planned retirement can go just as anticipated and life is good. But any one of these risk factors can and do crop up and can destroy everything if there is no contingency plan as well.

A little perspective is in order: Until recently (like within the last 100-150 years), retirement was only for the very wealthy. After Social Security and pension plans and all the other currency manipulation and industrial revolution... It was built on ever increasing productivity, consumption, tax structures, and slight lever adjustments to shift some of it down the road. Prior to that, most people worked in some way or other until they physically/mentally couldn't. And they didn't have $X,000,000 to pay for medical costs to prolong life. So they essentially worked until they died. "Retirement" is a First World phenomena that may or may not be sustainable as a goal for the majority of people. That doesn't mean to not plan for it. That doesn't mean not be responsible.

Economists haven't seen the wage growth they have been hoping for after the ongoing currency manipulation (low interest, helicopter money, QE). They seem to think it's still coming. But with developing nations putting pressure on domestic wages, it's easy to see the headwinds for "retirement" as we know it and as most people expect/hope for.

A little perspective is in order: Until recently (like within the last 100-150 years), retirement was only for the very wealthy. After Social Security and pension plans and all the other currency manipulation and industrial revolution... It was built on ever increasing productivity, consumption, tax structures, and slight lever adjustments to shift some of it down the road. Prior to that, most people worked in some way or other until they physically/mentally couldn't. And they didn't have $X,000,000 to pay for medical costs to prolong life. So they essentially worked until they died. "Retirement" is a First World phenomena that may or may not be sustainable as a goal for the majority of people. That doesn't mean to not plan for it. That doesn't mean not be responsible.

Economists haven't seen the wage growth they have been hoping for after the ongoing currency manipulation (low interest, helicopter money, QE). They seem to think it's still coming. But with developing nations putting pressure on domestic wages, it's easy to see the headwinds for "retirement" as we know it and as most people expect/hope for.

I'm sure there are several other unintended consequences of the modern age. The automobile allowed workers to live in suburbs and commute several miles each way. This caused a boom in single family home construction a few generations ago. Then of course the internet and mobile phones were believed to boost our productivity, but instead many of us are perpetually "on the clock" to a small degree.

A little perspective is in order: Until recently (like within the last 100-150 years), retirement was only for the very wealthy. After Social Security and pension plans and all the other currency manipulation and industrial revolution... It was built on ever increasing productivity, consumption, tax structures, and slight lever adjustments to shift some of it down the road. Prior to that, most people worked in some way or other until they physically/mentally couldn't. And they didn't have $X,000,000 to pay for medical costs to prolong life. So they essentially worked until they died. "Retirement" is a First World phenomena that may or may not be sustainable as a goal for the majority of people. That doesn't mean to not plan for it. That doesn't mean not be responsible.

Economists haven't seen the wage growth they have been hoping for after the ongoing currency manipulation (low interest, helicopter money, QE). They seem to think it's still coming. But with developing nations putting pressure on domestic wages, it's easy to see the headwinds for "retirement" as we know it and as most people expect/hope for.

Very true. Add to that that when Social Security was started in the 30s, the average workers only lived a couple of years past "retirement age." Now people can live 20-30 years after retiring. A LOT can happen in 30 years to upset financial situation: need to hire more help as your mobility decreases, vastly greater medical expenses, constant barrage of scams to suck away savings, vehicles wear out, etc. Plus, there is an expectation that you will be going on cruises and travel around. Not to mention the societal and broader economic changes (bubbles, taxes, inflation). I think few people have a realistic idea and plan for the risks to be faced over 20-30 years of retirement. I've seen a very few people enjoy the picture book retirement, very few. I've seen many die long before retirement age, or acquire major disabilities prior or soon after retirement, savings wiped out, scams rip them off of everything, unbelievable medical expenses even with cadillac plans.

It's a little murky. My grandparents never retired, technically. When gramps dropped the day job they legally became farmers full time. Contract the land and work futures markets to balance risk. I guess for about 4 generations in my family there was no retirement as they just went back to the farm.

But then, the farm was a MASSIVE asset. My grandmother passed in a decrepit farmhouse with floors that weren't level, a roof that leaked, a heater that broke weekly, plumbing that was essentially a coin toss, and a failing foundation while sitting on $1 mil of land. Were it not for the garden, sunroom and her collection of cacti she'd have gone sooner. She loved that land.

So I don't know. We've only been industrialized a while. Even in the 30s the depression solution was to retreat to the farms. I think we're in a big experiment where we move away from the land as a primary resource. It's a good question. Would you swap your 401 for a few hundred acres of farmland? It damn near tore my family apart selling it.

That is a very common situation, David. Around this area there a lot of family farms dating back to the late 1800s. They were passed on from gen1 to gen2 and perhaps gen3 intact, and even expanded as offspring started their own farms. Many farmers my age are now selling off large tracts and keeping 50 acres to lease out. Nothing really sustainable to pass on to their kids. And nowadays it is common NOT to pass the farm to the eldest or the one who stuck around, but it gets sold and divided evenly. Nothing left of a farm legacy. Not many of the "kids" want to farm anymore. Can't rely on cheap illegal immigrant labor as much as before.

I spent time in Iowa in the 1970s where this all happened decades ago and every family tract of 500 or so acres got bought up by the industrial Ag businesses. You end up with fewer and fewer family farms and more vast horizon-to-horizon industrial farms. Then they have such an advantage of economy of scale that the family farms struggle to compete in their own area.

Same old story: Big govt eventually leads to loss of family businesses and consolidation of resources into a few multi-national corps. Big loves big and squashes small. And most of the local family farms were all for government intervention: favorable tax rates for farms, national subsidies, land use restrictions, etc. You don't get govt favors without the blowback which is the giants crushing the family farm.

Just as we see the family doctor dying off under the burden of national healthcare, we see family farms withering away under tax/zoning/seed licensing/subsidies.

My paternal grandparents had an incredible place on Hood Canal for their retirement (Seabeck). My grandfather nought two wooded lots in the 1950s with cash, then logged one of them and traded the local mill for finished lumber. He used that to build a small cabin while he built his retirement house, then sold the cabin and its lot. It was one of the very few places within miles that had easy access to a pristine gravel beach, the lawn literally sloped down to the beach. He died at 75 after long years of dementia and hip problems. My grandmother lived in her house until she died at 100 yrs. He had a govt pension from the shipyard and social sec. But they never had mortgage payments, not a day of debt of any kind, and their 1957 BelAir lasted until neither could drive. Then the beach house was sold to be divided up between three surviving sons and the buyer leveled the house (which had beautiful stonework, fireplace, built-in cabinets and firewood box) and built a strange modern copper clad thing. No trace of that legacy left.

I think being free of debt and keeping as small an expense footprint as possible helps a lot. My grandparents also had a thriving garden and beehives that supplied much of their table produce, plus canning. They could walk to the local marina/market for their mail and groceries. The VA covered the worst of my grandfather's care (not ideal but better than not or facing crippling debt).

While the average 50-55 has $125,000 saved for retirement the median has only $8,000. That means half of those in the age group have UNDER $8k for retirement. It's the default position to believe everyone is just like you. I have more than $8k in Verizon stock right now.

Now I get the push for socialism. Half of Gen X have no plan for retirement. More than half. THE AVERAGE 50-55 HAS AN $8-9k CREDIT CARD BALANCE. They're in the red. And if they're paying the kids' college debt Bernie starts making sense. Not that I agree but I understand. Without a damn good pension you're basically homeless.

I can't believe it but I'm changing my tune. The economic disaster that will destroy America isn't the Fed and the funny money. It's a lack of savings. I just blanket assume that every 60 year old is a millionaire. Turns out they're penniless.

How did I manage such luck? I married a woman who, like me, automatically put 10% in a 401, 10% in IRAs, and let me have 5% to play with. I thought that was normal. This really is a disaster.

A single investment of $4000 dollars sitting in a brain-dead S&P 500 index fund for the last 35 years would have grown to $200,000 by now.

There's no excuse for hitting 50 with only $125k, let alone $8k.

Wake up and smell the cat food people!

Re these numbers "brain dead" is shifting in meaning. A Ronco "set it and forget it" is not only acceptable but compared to "I never bothered to try" it looks like genius.

I'm doing my best to crunch the numbers but I'll rely on the accountant dad here for a quote: "We're fucked". If the master plan is that we in a decade and a half have 50% of 70 year olds with literally no savings...

I suddenly hate myself. I'm sparring on this forum with other investors over what makes sense with our free money. I look like a fool debating Bitcoin, stock valuations, Y Combinator, currency markets, and other assets. None of that stuff matters if we're retiring broke. I used to think everyone thought like me...

Ultimately it's not a good feeling to be the smartest guy in the room. Apply this to almost any context, and it's equally unnerving.If you made millions, but 95% have nothing, its really a matter of physics, time and pitch forks...

From a basic security perspective, I must admit we'd all be safer if everyone in the class got a B-/C+.If you're the only kid scoring an A each exam, but the class average is failing, you're a target...

I worked briefly with a lady who never opened her 401. The company would match. She passed on free money to spend in the here and now. I was gobstopped.

I think the rational and prudent among us assume everybody puts 10% into retirement. Maybe in some special circumstances with entrepreneurs savings could be tied up in capital or some kind of investment but for the most part we assume it just comes out of the paycheck before you see it. Start day one and you never miss it.

The math on this is horrifying. My two year old has more savings than the median 55 year old. This is cataclysmic. half of Americans in their 50s aren't poor. They're destitute.

Social Security was never intended to be a retirement plan. It was intended to prevent death by starvation for the lucky few who outlived the rest. It's now more than just an emotional appeal for votes. People say "It's my money" when there's talk about changing the system.

Gen Xers have job hopped like no others before. And they don't rollover their 401k into an IRA for various reasons. We (I'm late Gen-X) don't have pensions or health benefits upon retirement. And most of our early jobs didn't have 401k plans with automatic enrollment. IRS/DOL have set a lot of protective measures in place for companies to set up automatic contribution arrangements over the 10-20 years. More recent generations at least have that going for them. Using the "4th Turning" vernacular, we're a lost generation in many ways.

Also, those between age 50-55 had the hardest time getting re-employed after losing a job. They aren't protected against age-ism and are paid more on average than younger people in the job pool. So instead of saving for retirement, they are forced to spend it down now.

Regarding contribution rates: there is no excuse not to contribute whatever gets you a company match. I can get there may be reasons for not doing 10%. But I cannot understand not doing 4% or 6% or whatever it is that maximizes however much company money you can get for free.

Those statistics are really very sad... and I look at my own family and see some of my siblings who are probably in the same boat with others either at or nearing 50 who have very little saved.

I look around and think about what people in their retirement years are doing... many do not have their homes paid for. That is huge. I totally cannot understand how they think they can live on a retirement check from social security and still make mortgage payments.

A friend of mine ,age 70 and still at a job, just 3 years ago got a 30 year mortgage on a house at 7.3 % and can't understand why I keep on her about getting the loan redone from someone else....some people you just can't help.